Why Should Delaware Care?
Grants from the National Institutes of Health fund 176 medical research projects in Delaware, with a total price tag in the state nearing $100 million. But a recent directive from the agency would drastically reduce the amount of money grant recipients could spend on overhead costs.
Clinical trials for child cancer patients, parenting studies of recovering addicts and analysis of brain functions of early-symptom Alzheimer patients could be among the Delaware-based research that is disrupted by new requirements on grants if the federal government prevails in a lawsuit filed Monday.
A coalition of 21 states including Delaware sued two of the nation’s top health agencies in response to a new mandate governing how federal grants can be used to fund overhead costs on medical research.
The federal lawsuit targets both the National Institutes of Health and U.S. Department of Health and Human Services for a recent NIH memo that capped what percentage of federal grants could be used on indirect costs like building construction, lab equipment and utilities.
“These illegal and indiscriminate cuts would be devastating not only to the work and workforce of Delaware’s research facilities but to the advancement of medical science and to the fight against disease,” Delaware Attorney General Kathy Jennings said in a statement.
One day after the lawsuit was filed, a judge put a temporary hold on the slash and a hearing to discuss the judge’s order was scheduled for Feb. 21. Another lawsuit filed by more than a dozen public and private universities challenged the NIH directive, calling it a “disaster for science.”
The state claims Delaware’s public universities stand to lose millions of dollars in funding should the NIH policy stand and the lawsuit fail. The state’s flagship pediatric hospital and a top recipient of federal grants in Delaware, Nemours Children’s Health, could also see losses.
Delaware State University, the state’s only Historically Black College and University, said in a statement the directive, if allowed to be enacted, would “necessitate” some layoffs and reductions in stipends for doctoral students.
The University of Delaware did not provide a comment prior to publication. Nemours did not respond to a request for comment.
Monday’s lawsuit comes after two more cases the state logged against the Trump administration over its efforts to end birthright citizenship and its nationwide freeze of federal funding.
What’s in the lawsuit?
The coalition of attorneys general filed their case in Massachusetts three days after NIH announced it would limit how federal dollars could be used to fund overhead costs on medical research.
More specifically, NIH targeted how much of the grants given out by the agency could be used on indirect costs. According to the lawsuit, indirect costs could include lab cleaning or it could be funding administrative costs.
What set off alarms in the medical research world was a 15% cap established in the Feb. 7 memo, and an effective date of three days later, which the states argued would be “immediate and devastating.”
The lawsuit also said NIH creating a one-size-fits-all limit for grants upends a longstanding practice of grant recipients negotiating these rates with the feds.
State AGs pointed to another failed attempt by President Donald Trump to cut the overhead rate to 10% in 2017. The attempt prompted lawmakers to pass legislation protecting how indirect costs are modified.
By “unilaterally” setting a rate, the states argue NIH and HHS violated the law.
“NIH’s extraordinary attempt to disrupt all existing and future grants not only poses an immediate threat to the nation’s research infrastructure, but will also have a long-lasting impact on its research capabilities and its ability to provide life-saving breakthroughs in scientific research,” the lawsuit said.
How could it impact Delaware?
NIH spent more than $35 billion on research in 2023, funding more than 50,000 grants at universities, health systems, and companies, according to the initial memo.
Records from NIH show the agency is funding 176 projects in Delaware worth nearly $100 million. Many of the grants were awarded to the University of Delaware and Delaware State University, the state’s two flagship universities.
Both universities could lose millions of dollars as a result of the new rates set by NIH, according to Attorney General Jennings’ office.
The University of Delaware could reportedly lose $12 million to support research and clinical trials at the university. Delaware State University said in a statement it would lose $1.4 million a year as a result of the rate cut.
Melissa Harrington, the associate vice president for research at DSU, said the university’s overhead reimbursement rate would drop more than 30% under the new directive leading to cuts.
Research that the university conducts on neurodegenerative diseases would also be imperiled, she said.
“It will necessitate laying off three or more research support personnel and reductions in or elimination of stipends for institutionally-supported doctoral students in DSU’s Neuroscience PhD program, the only such program offered at a HBCU,” Harrington said.
Data from the NIH lists the University of Delaware as the top recipient of grants in the state with 117 awards for nearly $60 million. UD did not respond to requests for comment on the impact NIH’s directive would have on research.
Delaware’s top pediatric facility, Nemours, also stands to lose grant dollars should the directive stand. While the hospital could not be reached to give a specific figure, the NIH data shows it received more grants than Delaware State University, and the second most in the state.
Soon after the state AGs filed their lawsuit against the feds, a judge put a temporary restraining order on the NIH slash, preventing the agency from implementing its change. Lawyers are set to debate the order on Feb. 21.
